Sunset clauses in Queensland: when a seller can end an off-the-plan sale

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Kooky

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A buyer who signs for a block of land or a unit that does not exist yet is buying a promise with a deadline attached. If the title is not ready by a certain day, somebody may be allowed to walk away. That day is the sunset date, and the term of the contract that says what happens when it passes is the sunset clause.

For years the clause drew little attention. Then prices rose faster than projects were finished, and the question of who may use the clause, and when, became one of the most argued points in Queensland property law. Parliament answered it in 2023 for one kind of sale only: land. For apartments and townhouses the answer still sits in each contract, read by the courts one clause at a time.

This guide sets out the rules as they stand in October 2026: the time limits the law puts on off-the-plan sales, the three routes by which a seller of land may end a contract under a sunset clause, what a judge weighs, what happens to the deposit, and what the Supreme Court has decided in the two best known recent cases. It describes the general rules. How they apply to one contract depends on that contract's wording.

Land Sales Act 1984, sections 14 and 19D; Body Corporate and Community Management Act 1997, section 217B as summarised by the Supreme Court in 2026.

What a sunset clause and a sunset date are

An off-the-plan contract is a sale of a "proposed lot": a piece of land or a unit that has no separate title yet. Before settlement can happen, a plan must be registered and the titles registry must create a title for the lot. For a unit, a community titles scheme has to be set up as well, and the building has to be finished and certified.

None of that is fully in the seller's hands. Approvals, weather, builders and lenders all have a say. So off-the-plan contracts name a last day for the job to be done, and say that if it is not done, the contract may be ended and the deposit goes back to the buyer.

The Land Sales Act 1984 now defines the terms for land. Under section 19B, a sunset clause is a term providing for the contract to be terminated if a "relevant event" does not happen by the sunset date. The relevant events are registration of the plan of subdivision, creation of a separate title for the lot, settlement, or another event set by regulation. The sunset date is the day by which that event must happen, or a later day the parties agree.

The time limits the statutes set

Behind the contract sit two statutory deadlines. They are often called sunset dates too, but they work in one direction only: they give a right to the buyer.

For land, section 14 of the Land Sales Act 1984 requires the seller to settle the sale of a proposed lot not later than 18 months after the buyer enters into the contract. If the seller does not, and the delay is not caused by the buyer's own default, the buyer may terminate by written notice given before settlement. The seller must also hand over the registered plan and a surveyor's statement at least 14 days before settlement.

For units, townhouses and other lots in a community titles scheme, the rule is in section 217B of the Body Corporate and Community Management Act 1997. The Supreme Court summarised it in an August 2026 judgment: broadly, the seller has the period stated in the contract, which cannot be longer than 5½ years, or 3½ years if the contract states no period. If settlement has not happened by then, the buyer may terminate.

Neither Act gives the seller a matching right. A Queensland Government page on buying off the plan, last updated on 13 April 2026, puts it plainly for land: the Act does not let sellers terminate after 18 months, but a sunset clause in the contract can. The seller's right to leave, where it exists, comes from the contract alone.

The 2023 reform: three routes for land

The Body Corporate and Community Management and Other Legislation Amendment Act 2023 added a new Division 4A, sections 19A to 19F, to the Land Sales Act 1984. The Department of Justice gives its commencement date as 22 November 2023, and the current version of the Act on the Queensland legislation site carries that same date, which means the Act has not been amended since.

The division begins with a simple rule in section 19C: a sunset clause cannot terminate an off-the-plan contract automatically. A clause written to end the contract by itself when the date passes is read instead as allowing termination under the division.

Section 19D then limits the seller. A seller may terminate under a sunset clause only in one of three ways:

• by giving the buyer a sunset clause notice and receiving the buyer's written consent;
• under an order of the Supreme Court; or
• in another way prescribed by regulation.

The third route is narrow by design. A regulation may add a method only if the Minister is satisfied it gives buyers adequate consumer protection, and a law firm commentary published in September 2025 reported that none had been prescribed. In practice there are two routes.

The reform reaches back as well as forward. According to the Department of Justice, it applies to off-the-plan land contracts entered into on or after 22 November 2023 and to contracts that were still on foot on that date. Section 22 of the Act, which makes contracting out void, covers the new division: a term intended to avoid it has no effect to that extent. Buyers' own termination rights were left as they were.

The notice, and what the buyer must do with it

The consent route has a fixed procedure. The notice must be in writing and given at least 28 days before the sunset date. It must say that the seller proposes to terminate, that this can only happen with the buyer's written consent, why the seller wants to terminate, and that the buyer must answer no later than the day before the sunset date.

Section 19E puts duties on the buyer as well. The buyer must consider the notice, act reasonably and respond in the time stated. A buyer who does not answer has not agreed: the Act does not treat silence as consent. But a buyer who refuses without good reason takes a risk on legal costs, described below.

A worked example with illustrative dates shows how the periods fit together. A buyer signs a land contract on 3 March 2025. Eighteen months later is 3 September 2026, and the contract names that day as its sunset date. A seller who wanted the buyer's consent to terminate would need to give the notice by 6 August 2026, which is 28 days before, and the buyer would have until 2 September 2026 to answer.

What the Supreme Court weighs

If the buyer says no, the seller's remaining path is section 19F. The seller applies to the Supreme Court, and the court may permit termination if the seller satisfies it that this is, in the Act's words, "just and equitable in the circumstances".

The section lists what the judge must consider:

• the terms of the contract, including whether a term is intended to avoid the division;
• whether the seller acted unreasonably or in bad faith in performing its obligations;
• whether matters beyond the seller's reasonable control affected its ability to settle, or the viability of its business;
• whether there is a reasonable prospect of the seller settling;
• what the seller did to settle and to limit the effect of whatever went wrong;
• the effect on the seller of having to settle;
• the effect on the buyer of termination;
• how far the buyer has performed their own obligations;
• whether the land has increased in value;
• anything else the court considers relevant, or a regulation prescribes.

On costs, the starting point favours the buyer. Under section 19F(4) the seller must pay the buyer's costs of the proceeding unless the seller shows that the buyer unreasonably withheld consent.

How the court applies these matters is still untested. In its submission of 10 October 2025 to the Government's review, the Queensland Law Society's Property and Development Law Committee said it was not aware of any developer having applied to the Supreme Court under the provisions. It gave two reasons: the 18-month period is, in its words, "invariably sufficient" for subdivision and titling, and the likely gain on land alone over that time would rarely justify the cost of an application.

Apartments and townhouses: what is and is not law

The 2023 division sits in the Land Sales Act 1984. It was not copied into the Body Corporate and Community Management Act 1997, which governs off-the-plan sales of scheme lots.

The Department of Justice states the limits directly. The reforms do not apply to lots in community titles schemes, such as apartments in buildings under construction, and they do not apply to sunset clauses in linked or single house-and-land contracts.

The history explains why the question is still open. The Queensland Law Society's submission records that the explanatory notes to the 2023 Bill, and the parliamentary committee that examined it, both said a later review would consider extending the reforms to community titles lots. The Society recommended the extension in 2023 and again in 2025, pointing out that the equivalent New South Wales rules cover both land and scheme lots.

The review came in 2025. The Attorney-General, Deb Frecklington, announced it on 1 September 2025, and consultation ran until 10 October 2025. Its stated subject was how well the 2023 amendments were working for land. In an article on its advocacy, the Law Society's magazine said the Society was disappointed that the survey did not extend to apartments.

The most recent official word is an answer to a parliamentary question on notice asked on 10 February 2026. The Attorney-General reported 206 survey responses, 178 from consumers and 28 from property developers, plus seven written submissions from peak bodies in the housing, development, consumer, real estate and legal sectors and two from individuals. The answer gave no findings and said the outcomes would be made known "in due course".

The statute book matches that. The current version of the Body Corporate and Community Management Act 1997 on the Queensland legislation site is dated 1 August 2025, and the Government's own off-the-plan page, updated in April 2026, still says the sunset clause limits do not cover community titles schemes.

Land and apartments side by side

A house-and-land package can fall on either side of the table, or outside the land reform altogether, depending on how its contracts are put together.

The deposit, the interest and the 20% figure

Off-the-plan deposits do not go to the seller. Under sections 15 to 17 of the Land Sales Act 1984, money paid towards a proposed lot goes to a law practice or real estate agent named in the contract, or otherwise to the public trustee, and is held in a trust account. The Queensland Government's guidance says the same of off-the-plan deposits generally: the seller cannot have early access, and the money is released at settlement or when the contract otherwise ends and the seller is entitled to it.

The 20% figure comes from the Property Law Act 2023, which commenced on 1 August 2025. Section 87 defines a deposit as a sum of not more than the prescribed percentage of the price, and sets that percentage at 20% for a proposed lot and 10% otherwise. A contract that takes more than that before settlement moves towards the separate rules for instalment contracts, which is why off-the-plan deposits stop at 20%. Section 85 allows a seller to keep a deposit of up to 20% of the price of a proposed lot when the buyer's breach ends the contract.

What happens to the money when the contract ends depends on who ends it and why.

When the buyer terminates under the Land Sales Act 1984, section 20 requires repayment within 14 days of the amounts paid and any interest that accrued on them, subject to the rules of the trust account, and the sum can be recovered as a debt. For scheme lots, the Attorney-General's 2022 petition response said a buyer who terminates under the Act's time limit can recover the deposit.

When a contract ends under a sunset clause, the refund is a matter for the clause itself. The Land Sales Act 1984 sets out no separate refund rule for that case. Contracts usually provide for the deposit to go back in full. The apartment contracts examined by the Supreme Court in 2026 required the stakeholder to refund the deposit with any interest earned on it, and bank guarantees to be returned. Whether there is interest at all depends on whether the contract had the deposit invested, and on what it says about who receives the earnings.

A higher price, or a new contract

Media reports in 2025, collected by the Queensland Law Society in its submission with the note that it could not verify them, described unit buyers being offered a choice between paying more and having their contracts ended under a sunset clause.

The law on the first half of that choice is ordinary contract law. A price in a signed contract changes only if both parties agree to vary it. A buyer is free to say no, and a seller is free to ask.

What matters is what the seller may do after a refusal. For land, the answer since November 2023 is that the seller cannot use the sunset clause without the buyer's written consent or a court order, and a rise in the land's value is one of the matters the judge must consider. A buyer who is asked to agree to end a land contract is being asked for the consent the Act requires, and may take advice before giving it.

For a unit, the answer depends on whether the clause really gives the seller the right it relies on. That is a question of wording, and two Supreme Court decisions show how closely the wording is read.

Where seller disclosure fits

The seller disclosure scheme of the Property Law Act 2023, with its disclosure statement and prescribed certificates, does not apply to off-the-plan sales. Guidance published in the Queensland Law Society's magazine explains that the scheme covers a lot under the Land Title Act 1994, and that a proposed lot under the Land Sales Act 1984 or the Body Corporate and Community Management Act 1997 is not one.

Off-the-plan buyers get a different set of documents instead. For land, section 10 of the Land Sales Act 1984 requires a disclosure plan and a disclosure statement before the contract, and section 12 requires the statement to record the seller's duty to settle within 18 months. For a unit, section 213 of the 1997 Act requires a disclosure statement before the contract. A law firm commentary published in April 2026 lists the sunset date among the matters these statements cover.

What the courts have decided

Two published Supreme Court decisions deal with sellers ending apartment contracts after a sunset date. Both turned on the words of the contract. Neither applied the 2023 land reform, which does not cover units.

In the first, delivered on 12 June 2025, the buyer had agreed in June 2017 to pay $4.2 million for two apartments, with a deposit of $420,000. The sunset date was 30 December 2022. The court found the separate titles were ready by November 2022, so the seller had been able to give the notice that starts the settlement process. The seller did not give it, and in April 2023 purported to terminate under the sunset clause.

The Chief Justice held that the clause applied only where the seller was unable to give the notice. Reading it otherwise would hand the seller a power to end the contract at will, which made no commercial sense. The apartments had since been sold to others, so the remedy was damages: the court valued them at $10.3 million and awarded the difference from the contract price, $6.1 million, plus interest. The court's record shows a notice of appeal filed in July 2025.

In the second, delivered on 21 August 2026, two contracts signed in 2021 had sunset dates five years later, in April and May 2026. The seller terminated after each date passed. The contract said the seller "must" establish the scheme, register the plan and settle by the sunset date. The judge held that this was an obligation, and applied a long-standing presumption, discussed by the Court of Appeal in 2005, that parties do not intend one of them to gain from its own failure to perform. Both contracts were declared valid and binding. The court's record notes that notices of appeal have been filed.

Lawyers commenting on the 2026 decision have been careful about its reach. One firm's note says it does not create a blanket rule that a developer can never end a delayed off-the-plan contract; the result depends on each contract read as a whole. A sunset clause drafted as a neutral cut-off, with no promise by the seller to finish by the date, would raise a different question.

For land, the rule is in the Act. For a unit, it is still in the contract, and each contract is read on its own words.

Kooky, from Shaka

Kooky edits Queensland Estate and builds Shaka, the payment router he made for Queensland property professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

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